Fleet and business growth continues to drive new car registrations

Posted on

Jun 8, 2016

According to data from the Society of Motor Manufacturers and Traders (SMMT), fleet and business growth has continued to drive new car registrations for the second month in a row.
Year-on-year private sales have actually dropped for a second consecutive month, but May 2016 saw a 7.1 per cent increase in fleet and business registrations. Fleet business registrations also increased on a year-on-year basis by 4.9 per cent.
Demand for diesel cars was superior to petrol models, with demand increasing by 5 per cent for the former and decreasing by 0.6 per cent for the latter. Uptake of alternatively fuelled vehicles also rose, outstripping the market quite substantially: registrations increased by 12.1 per cent.
The total number of cars registered so far in 2016 has now reached 1,164,870: a 4.1 per cent rise year-on-year. The easing of growth in May - which saw the second consecutive month of sub-3 per cent growth - has already been taken as evidence of the market's increasing stability following the record numbers seen in 2015.
Last year, UK new car sales hit an all-time record, with trade industry figures showing a total of 2.63 million vehicles - a 6 per cent increase on 2014 - being registered. This was the fourth consecutive year of growth according to the SMMT, with a number of factors - stronger consumer confidence, special deals and cheap finance - all believed to have contributed substantially to the high levels of consumer performance.
Registrations in 2015 outperformed the previous record - 2.58 million cars - seen in 2003. The global financial crisis affected the industry quite heavily, but since then it has continued to recover.
Mike Hawes, chief executive for the SMMT, said: 'The new car market in May remained high with compelling offers available on the latest vehicles, but the low growth is further evidence of the market cooling in the face of concerns around economic and political stability.
'Whether this is the result of some buyers holding off until the current uncertainty is resolved or a sign of a more stable market for new cars remains to be seen.î